The Japanese subsidiary of bankrupt crypto exchange FTX plans to resume withdrawals before the end of the year.
According to a Nov. 21 report from Japanese media outlet NHK, preparations for enabling withdrawals for FTX Japan users are already underway.
FTX Japan suspended operations at the request of the country’s Financial Services Agency (FSA) on Nov. 10 – a day before its parent company FTX filed for Chapter 11 Bankruptcy in the U.S.
“It is necessary to take all possible measures to prevent a situation in which the interests of creditors and investors are harmed by the outflow to affiliated companies of the Company,” said the FSA in a statement at the time.
The FSA also directed FTX Japan to submit a “business improvement plan” by Nov. 16, identifying the exchange’s investors and their corresponding assets.
Speaking to NHK on Monday, an FTX Japan executive said that the exchange is currently unable to process withdrawals because it is included in the list of subsidiaries under “FTX Trading” in its bankruptcy proceedings.
However, the executive said that FTX Japan is developing “its own system” so that customers can withdraw their assets locked on the exchange. According to him, the system will be ready for delivery before the end of 2022.
The feasibility of such a task given the complicated ongoing liquidation proceedings of its parent company FTX still remains to be seen. While some FTX subsidiaries are debt free, FTX’s liquidator and CEO John Jay Ray III noted that the Japanese subsidiary isn’t one of them.
FTX Japan said it has $138 million worth of cash and deposits on the exchange. Japanese users were the third-most impacted in the FTX collapse, after users from South Korea and Singapore, data from CoinGecko shows.
